The electronic contract manufacturing industry has a wide range of options ranging from multi-billion dollar diversified global businesses to small job shops. Regional contract manufacturers fill the void between the small and large players. In some cases, regional contractors operate from a single facility and other cases they have multiple facilities.
Milwaukee Electronics is a regional contract manufacturer focused on providing a North American manufacturing solution ranging from SMT PCB assembly through box build. Its Portland, OR and Milwaukee, WI operations provide test engineering and manufacturing services supporting West coast, Midwest and Canadian customers, while its Tecate, Mexico facility supports customers wishing to achieve the cost advantage of offshore manufacturing while staying without the logistics costs and transit time associated with leaving North America.
Why choose a regional contract manufacturer? Here are four good reasons:
Project Size: Projects representing less than $50 million in annualized revenue often get lost in Tier One multi-billion businesses. Not literally, but figuratively. The demands of larger customers tend to take priority. At the regional level, sub-$50 million projects represent the bulk of the business.
Demand Variability: The larger the contract manufacturer, the more likely business with predicable volumes is preferred. Larger contractors base their business models on high equipment utilization. Projects which drive frequent changeovers or schedule changes negatively impact production floor efficiency. Conversely, regional contract manufacturers thrive on high mix, variable demand business and often optimize equipment choices to more efficiently accommodate frequent changeovers.
Responsiveness: The larger a company the more layers of management and the less flexibility. Regional contract manufacturers typically have only one or two layers of management. If the project requires flexibility in scheduling or investment in capital equipment, decisions are made quickly. Responsiveness is a key component of the regional contract manufacturing business model, since many suppliers are chosen based on proximity to the customer.
Cost: While global contract manufacturers tout cost advantages, the reality is that smaller projects are unlikely to see the same cost benefits found by their largest customers. Does it really make sense to use a company with 30 manufacturing facilities, when your project requires a single facility? Regional contract manufacturers have smaller footprints which translate to lower overhead costs. Companies with multiple facilities, such as Milwaukee Electronics are large enough to provide growing projects with scalability, but small enough to represent a cost effective choice for PCB assembly projects requiring only one facility.
How should you best use a regional contract manufacturer?
Electronics manufacturing projects often have a mix of business. In some case, the entire mix of products is best served by being sourced to a regional contract manufacturer or multiple suppliers in this size class. In other cases, the regional contract manufacturer may serve as a second source supporting high mix, variable demand production, while a larger contract manufacturer handles any high volume business.
Regional contract manufacturers may also be a good option for companies wishing to keep manufacturing close to their product development teams or clustered within a single major region such as North America.
The bottom line is that utilizing a regional contract manufacturer such as Milwaukee Electronics, offers a right-sized, responsive solution to a wide range of electronics manufacturing needs.
